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Enter the Dragon

Dragons’ Den is back on BBC TV, starting Sunday 31st July, and with it a regular insight into the world of venture capitalism and investment funding.

If you haven’t seen the show, the ‘Dragons’ are five entrepreneurs who, each week, judge a series of pitches. If they see an opportunity, they make an investment offer. If they don’t, they declare themselves ‘out’.

Dragons’ Den is interesting because you really do get to see the dynamics of the pitch in action, unlike on this year’s The Apprentice.

In the Den, the numbers have to stack up first and foremost. But on top of that, the quality of the pitch definitely makes a difference.

In previous series, we’ve seen good business plans fail because the Dragons took a real dislike to an arrogant pitcher. Equally, we’ve seen weak business plans succeed, thanks to an inspiring or heartflet pitch.

Such a winner was Levi Roots, inventor of Reggae Reggae sauce, which you now see in supermarkets and as an ingredient in other products. Levi’s pitch wasn’t strong on business sense, but it more than made up for that in honesty and passion.

Another thing that we can observe is that not every investment is right for every Dragon, regardless of the numbers. They tend to stick to what they know. And yet it's amazing how few 'contestants' seem to do their research before they walk in to the Den. When you pitch, you do take some time to learn about your audience, don't you?

This year sees a new Dragon, Hilary Deven, who takes over from James Caan. The arrival of a new Dragon is fascinating, because it can lead to new dynamics as the relationships within the Den rebalance themselves to accommodate the newcomer.

I’ll be watching, and commenting. You should too, if you want to learn how to tame your very own Dragon.

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